Rare earth prices have rebounded from the bottom in early March and have risen by about 30% so far. Take praseodymium oxide as an example, it rebounded from 340,000 yuan/ton in early March to the current 450,000 yuan/ton, an increase of 32%. The stabilization and rebound of rare earth prices indicate that market buyers and sellers recognize the current rare earth prices, and downstream manufacturers have started to replenish their inventories, thus boosting the price of rare earths. The stabilization and recovery of rare earth prices are no longer as roller coaster as last year, which is conducive to the healthy development of the rare earth deep processing industry.

 

　　We believe that the performance of the NdFeB permanent magnet material sub-industry in the first half of 2012 will be guaranteed, and securities firms are optimistic about the investment opportunities in this sub-sector in the first half of the year.

 

　　In addition, with the arrival of the peak demand season in the second quarter, orders for NdFeB permanent magnet materials have begun to pick up, which is conducive to improving the performance of the industry. Taking the industry leader Zhongke Sanhuan as an example, the company has obtained an order of 250 million yuan from Bakker Magnetics in the Netherlands, which is three times the order of the company in 2010. This reflects the pick-up of demand in the NdFeB sub-industry from one side.

 

　　It is observed that the rare earth deep processing industry has not yet begun to adjust prices in the first half of 2011, but only after the third quarter did it begin to adjust the linkage between ex-factory prices and raw material prices. Therefore, the industry's first half performance base is relatively low, which is the first half of 2012. The year-on-year increase lays the foundation. Based on this judgment, a year-on-year increase in industry quarterly and semi-annual reports is a high probability event. The just-announced first quarter report performance of Zhenghai Magnetic Materials increased by 20% year-on-year, which partially confirmed the judgment.